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If You Have $1,000, This Could Be the Best Investment You'll Ever Make

It's that time of year. Millions of us are making New Year's
resolutions.

Unsurprisingly, the most common resolution is to lose weight. I
can't think of but a handful of people who wouldn't want to shed a
couple of pounds.

But despite our best intentions, statistics show the vast majority
of us won't keep our resolutions (yes, they actually have studies
on this stuff).

The "experts" say the best way to keep your resolutions is to start
small. Make an attainable goal and take baby steps to achieve it.
Radically changing your life on Jan. 1 is difficult at best. Why
would you set yourself up for failure?

So I have a small change to make to your investing for 2011. I'd
like for you to put money in the best investment you'll ever make.
It may not sound like a small task, but don't worry. It will be
easy; even easier than losing those few pounds.

All it takes to start is $1,000. I selected this amount because
it's a nice round number to start from and if you're an investor,
you can usually come up with that much without too much trouble or
sacrifice. If you'd like to invest more, that's no problem. It will
simply amplify your results.

If you're risk-averse, that's great. This investment is one of the
safest you can make. And remember, if you're skeptical or simply
don't like how the $1,000 investment is going, you can always stop.
Let's be honest -- no one cares more about your money than you do.
If you aren't comfortable, don't continue.

With your $1,000, I want you to find one investment that pays
anywhere from 6-10% in dividends each year. It is best if the stock
pays monthly, but quarterly is fine.

It doesn't really matter if the investment is a stock, a fund or
even a master limitedpartnership . What's most important is that
the investment be relatively stable, but -- and I can't emphasize
this enough -- the dividends
have
to be secure.

High-yielding blue-chip stocks such as
AT&T (NYSE:
T
)
are a good choice for this test. AT&T pays a shade below 6%,
but that's OK. Realestate investment trusts like
Government Properties Income Trust (NYSE:
GOV
)
would also work well. The higher theyield , the better the results
of your test should be, but anything in the 6-10% range should be
fine.

Once you have your investment picked out, you know where to put all
of your $1,000. But there are two more small steps to take.

First, you have to
reinvest
your dividends. Usually all this takes is a call to your broker or
selecting theoption in your online account. Second, you should add
$1,000 to your initial investment once a year.

I told you it was easy. But if you can follow this simple strategy,
it might end up being the best investment you ever make.

Say your $1,000 is bringing in 8% a year in dividends and the price
rises a pedestrian 4% a year. At the end of your first year, your
$1,000 would be worth about $1,120 for a return of 12%.

That's not bad, but as time passes the results of the test prove
how valuable the strategy is. Take a look at the chart below.

At five years you will have put up just $5,000, but your investment
would be worth $6,393. That's a 28% gain. For reference, the
S&P 500 is up 2% over the last five years.

In 10 years, you'll be sitting on a 78% gain... and an investment
worth $17,823. Your 8%yield would also be worth more than $1,400 a
year. In 15 years you'd have more than $27,000 in your investment.

Is this a way to get rich quick? Sorry, if that's what you want,
then stick to all-or-nothing growth stocks. (How well has that
worked out for investors in the past decade?) Is it a way to get
rich slowly? Absolutely.

Action to take -->
With the start of a new year, making smart financial choices is
near top of many people's resolution list. You can make it easy on
yourself, starting with just $1,000 and most likely turning it into
the best investment you'll ever make.

-- Amy Calistri

P.S. -- I believe so much in reinvesting dividends that it is a
cornerstone of my "Daily Paycheck" strategy. If you want to learn
more about how to implement the same strategy I use, click here to
read my course on the topic. I provide all the details and eight
high-yield ideas to get you started. Click here to read my free
course now.

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